::: COMMUNITY NEWS

CSD sees rate increases in the community's future

Corrected Wednesday, January 31, 2007
Expanded Tuesday, January 30, 2007
Published Monday, January 29, 2007

Residents can expect costs for the utility and security services provided by the Community Services District to go up this year and in future years.

At the CSD board's four-hour goal workshop last week, the directors identified costs for labor, repairs and replacement, and increased regulatory oversight as some of the factors driving rates up.

In the long-term, water use options in the CSD Integrated Water Master Plan -- conservation, limiting water for large lots, using drought-tolerant landscaping, tiered water pricing, and "purple pipe" applications for recycled water – will also affect rates.

The CSD isn't alone in responding to financial challenges with higher rates, the directors noted. The city of Elk Grove is implementing steep water rate increases and Sacramento County is projecting triple-digit rate hikes for utilities over the next decade.

In the last few years, the CSD has used reserves to cushion the financial impact of a two-year cut in property tax revenue, a slowdown in development, and the cease and desist order, with consultant, legal and construction-related costs to date of $500,000.

The replacement reserve program has been hard-hit, said CSD General Manager Ed Crouse at the Jan. 23 meeting. The reserves for future repair and replacement for water and wastewater operations are funded with a $6 fee that is part of ratepayers' monthly CSD bill. The flat fee is not tied to a cost-of-living index.

Developers fund the capital improvement projects through a $1,200-per-unit fee and pay for infrastructure, while ratepayers are responsible for the district's operating expenses, said Crouse, explaining the relationship between the district's finances and development. "(Developers) drive our ability to spread more (costs) to more residents and, if they're not developing, there's more pressure on our existing residents to pay for the incremental increase every year," he said.

Crouse guesses it could be three to four years before new development generates a significant amount of money for the CSD.

"In the past, the district has been pretty blessed with about 100 units coming on line every year and that's covered our inflation nut … (and) cost of living adjustments for either labor or materials," he said, adding that that hasn't happened for the last couple years.

Director Bob Kjome observed that the CSD has settled for "modest" rate increases while the Rancho Murieta Association and the Country Club have raised dues 10 percent a year.

The RMA, which can increase dues a maximum of 20 percent a year, had a 10 percent increase for 2007. According to Country Club President Vince Lepera, the club raised dues 5 percent -- the maximum increase allowed under club bylaws -- effective May 2006, and has no plans for a dues increase this year.

RMA dues are currently $131.75 a month, and golfing members of the Country Club pay $352 a month. The average CSD residential bill at present for water, sewer and drainage services is $88.02, according to Les Tyler, CSD director of administration. Garbage service adds $16 a month, making the average total $104.02 a month, Tyler said Wednesday in a clarification of earlier cost information he provided.

Previous CSD boards took pride in keeping rates as low as possible. The 6 percent increase for the 2005 fiscal year was characterized as the first rate increase in years, aside from a dollar increase in the monthly security rate that occurred when the bar-code access system was installed.

The CSD has the ability to raise rates for water and sewer services under Proposition 218, although security and drainage are special taxes that will require a two-thirds vote of approval by residents if a higher rate ceiling is needed.

The 2007 goals will be presented at the February board meeting.

The board discussed the following topics at the workshop.

Development

Meetings with the three developers for the Retreat and Residences projects on the North, the South developer, and the developer for the shopping center and 200-unit residential project across from the Plaza have resumed on a weekly basis since the Jan. 10 county hearing on projects planned for Murieta North.

The developers' goal is a financing and services agreement for the 700 units involved in the projects. Negotiations were "sidetracked" due to a lack of interest on the part of the developers last summer and fall, said Crouse.

The infrastructure issues include drought augmentation, expanding the water treatment plant, and wastewater storage and disposal.

"We're trying to reach common consensus on what's needed, what the capacity is and what the cost is," said Crouse. "We have an obligation to provide service because they're in the district. We're still neutral. We've always been neutral for all development projects."

Since the district requires payment upfront for infrastructure and won't provide services until capacity is available, "It's one of those questions – (the) chicken or the egg? Which comes first, plant capacity or development?" said Crouse. "In the 1990s, our board decided that all major infrastructure would be funded by developers" and not by current residents or the district because reimbursement was considered "iffy."

The district is looking at different tiers of development, but it is not "pre-planning with a definitive density for the future," according to Crouse.

At the present time, the district is not meeting with the Pension Trust Fund for Operating Engineers about development, and views the PTF's remaining 750 acres in Murieta North as a later phase of development that could add 1,000-1,100 units when combined with development of the apartment site next to the RMA Building and the former school site on Escuela Drive. The Murieta West plan proposed by John Sullivan is considered a possible third phase of development that would add 400 to 600 units if approved by the county.

As far as the PTF is concerned, Crouse said the district is "not planning on any development unless and until PTF decides. … We'll meet with PTF whenever they're ready and available to meet on their infrastructure needs. We believe it's a good idea for them to identify infrastructure needs and cost and financing so that if they ever decide to develop or sell the property they can sell an identified package complete to somebody else, whereas now they have a lot of unknowns. If they were to broker the deal right now, (the buyers) are going to discount their purchase price a big amount for the unknown. … The (financing and services) agreements commit money and heretofore PTF hasn't been willing to commit money long-term."

Wastewater storage and disposal

The CSD is dealing with both short-term and long-term wastewater storage and disposal issues in the cease and desist order.

A consultant is now working on a build-out plan with a July deadline. The CSD is meeting with the Country Club for formal discussions about its recycled water use to develop a water balance strategy for both wet and normal years.

At the same time, the CSD is working with developers to identify their storage and disposal needs.

Besides supplying the Country Club with water for the golf courses, the CSD is considering disposal of recycled water on ranch land as an option.

The district planned to use 100 acres on the neighboring Van Vleck Ranch to get rid of short-term excess carryover storage, but it turned out the approval process would take one to two years, Crouse said.

Instead, the district installed 3,500 feet of sprinklers and 16 evaporative fountains at the wastewater treatment plant ponds last year and "they were successful in knocking down a big chunk of the carryover storage," said Crouse.

But the Country Club has been using less water the last couple years because of changes in its operations and wet winters, which also affected storage.

The district ended the irrigation season with 297 acre feet of stored water instead of the 100-acre-foot maximum that would allow increased flows to the plant under the terms of the cease and desist order.

With a drier winter and a commitment from the club to use more water, the CSD hopes to get rid of the surplus this year.

Crouse said the developers have made a purchase agreement for 100 acres of Van Vleck ranch land with the understanding that they will dedicate the land as their projects are approved to meet their own disposal needs.

"Purple pipe" applications for recycled water are another option that will be investigated this year as the board considers strategies in the Integrated Water Master Plan in what Crouse termed "a big education effort."

Security

Security Chief Greg Remson said the department's goals for 2007 include providing laptop computers for patrol use once the wireless cloud for Internet access is available. The wireless connection will enable officers to file reports and retrieve information using the laptops while remaining on street patrol. The department also plans to use sophisticated cameras for surveillance at CSD facilities and parks.

Remson said the department will continue to work with the RMA on speeding and stop sign enforcement, and confirmed the effectiveness of the radar trailers RMA Compliance uses on the North and South. The trailers' screens flash for any speed over the limit of 25 mph.

Remson said Security does not have the authority to stop speeding motorists or stop sign runners, and uses license plate numbers to track offenders. Director Dick Taylor termed the enforcement system "faulty."

"We do detain people," said Remson, "but we're not going to detain people unless they're going to jail for sure, or they've violated a district ordinance where we can cite and release them and put them in court, or it's a safety issue which we feel needs to be addressed immediately and that safety issue may result in someone going to jail."

When Director Bobbi Belton suggested that residents who are going out of town notify Security, Remson said the gate currently has 30 such requests at any given time and the information is placed in the computer system. The information shows up when a vendor or visitor requests access using the resident's name.

The department's 2006 accomplishments included the opening of the James L. Noller Safety Center, the remodel of the South Gate guard station so passes can be given out (although they will have to be differentiated from the North Gate passes, Remson said), replacement of patrol radios, expanded use of computer record-keeping for incidents and reports, and deployment of two patrol officers during the busy 4 to 11 p.m. swing shift.

During the board's brief discussion about changing the status of Security patrol officers to that of peace officers, Director Bob Kjome said he saw the costs of peace officer status as "excessive" in the absence of a "compelling need" for change.
General Manager Ed Crouse said the district's focus group research indicated overall satisfaction with the present level of enforcement.

Remson said the current level of enforcement might be a community issue and not a cost issue.

Staffing

The board made employee retention a goal after the general manager said, "We're struggling out here with whether we're an incubator for (water plant) operators or whether we're a recruit-and-retain employer."

Turnover carries recruitment costs and creates inefficiencies in training staff, Crouse said.

Director Dick Taylor said there are two groups of employees to be considered and recommended "wage-rate correction" for union-represented staff and long-range incentives for others.

The district is now in negotiations for a three-year contract with the Operating Engineers, the union that represents non-supervisory water, security and administrative employees.

The board also discussed staffing needs. Crouse said an additional plant operator would be needed when the water treatment plant is expanded to accommodate new development. There is also "a lot more paperwork" and reporting to do as regulatory requirements increase, he said.

Kjome asked if the hire of a district engineer would free up Crouse. President Wayne Kuntz said an assistant general manager might be a hiring consideration since the district's succession plan for the general manager no longer applies because of a change in staff.

The district would still need to hire engineering consultants even with another staff member, said Crouse.

On the subject of hiring an additional Security patrol officer, Remson said, "Could we use another patrol officer? Absolutely. Can we afford one? I think we might be getting ahead (of ourselves). We should probably focus on keeping the ones we have first."
Crouse estimated the ballpark figure for a new hire at about $50,000 a year with benefits, wages and other costs, which would be an additional $1.60 a month for the 2,500 current ratepayers.

Bass Lake

The clean-up of Bass Lake was a 2006 goal that was dropped for 2007. The CSD made it increasingly clear throughout 2006 that the lake is the Country Club's responsibility under the terms of the cease and desist order issued by the Central Valley Regional Water Quality Control Board a year ago.

The club is working with the RMA to strike a balance between the regional board's requirements and the community's expectations for a "natural" lake.

The lake is used to store recycled water during the irrigation season for use on the North Course.

Unlike the golf course lakes used to irrigate the courses, Bass Lake belongs to the RMA and the CSD holds an easement to put recycled water in it.

The club has limited tule growth to a few areas where it can be controlled and added three fountains for aeration to improve water quality and eliminate odors. Nuisance odors are one of the cease and desist order issues. The club's other issue in the cease and desist order is the overflows from the lakes used to irrigate the golf courses.

Under the diversion plan the club is pursuing to prevent the overflows, Bass Lake is expected to be drawn down as much as nine feet before the onset of the rainy season.

Last October the CSD proposed abandoning its easement to put recycled water in the lake to reduce the district's liability. The move was opposed by the RMA as well as the club. The resolution was tabled indefinitely after the club expressed support for the CSD's preferred solution to the overflows, which would keep the recycled wastewater out of the lakes and instead use a tank for storage. The club also agreed to use more recycled water, which should help to address the wastewater storage and disposal issue the CSD is responsible for in the cease and desist order.

On Tuesday, Crouse said, "What we're envisioning is not totally abandoning (the easement), but a shifting of responsibilities over to the Country Club. They're the ones that are going to be dictating the levels in Bass Lake, not the CSD, not RMA. Whether RMA agrees to that has yet to be seen."

Communications

The board sees a need for more communication with the community about water and wastewater operations, but it is not inclined to televise its monthly meetings. Directors Bill White, Dick Taylor and Bob Kjome all expressed doubts about the value of televising the meetings, causing advocate Director Bobbi Belton to remark that she was "outvoted."

Kjome said he was "not a big fan of televised meetings" and cited the cost factor, while Taylor and White expressed concern that it would have an adverse effect on the tone and content of the meetings.

2007 projects and goals

• Implement the district's technology plan by creating a "wireless cloud" for Internet communications
• Make lift station improvements
• Move forward with the rehabilitation of the 30-year-old Rio Oso water tank, at a total cost expected to exceed $1 million.
• Install blowers at Lake Chesbro to improve the quality of the water going into the water treatment plant
• Replace a diesel fuel tank on the South
• Replace the monitoring wells that measure seepage at Granlees Dam.
• Obtain a newly mandated state permit for managing sewer lines that will carry additional monitoring, maintenance and reporting requirements.
• Implement the district's storm water permit with monitoring and staff training.
• Reduce groundwater and storm water infiltration and inflow at sewer lines and manhole covers to stay within the limits set by the cease and desist order for wastewater treatment plant inflow.
• Perform preventive maintenance.
• Scale down the water treatment plant expansion to meet the needs of current development projects. The plant will be paid for by the developers.
• Develop documentation for troubleshooting and disaster recovery for CSD computer network operations.
• Implement a capital improvements plan that puts reserves and projects together in a 5-year budgeting plan.
  
  

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